VICTORIA, B.C. — Attorney General David Eby announced several changes to automobile insurance payouts that will take effect in just over a year’s time as part of the government’s efforts to save the Insurance Corporation of B.C.
Eby announced that effective April 1st, 2019, there will be a new claim limit of $5,500 on pain and suffering for minor injury claims, which includes sprains and minor whiplash. He said that the cost of those claims has increased by 265 percent in the last 18 years.
In addition, Eby said that an independent dispute resolution process will be implemented for certain motor vehicle injury claims, which he said would reduce the number of expensive Court cases. Disputes over certain motor vehicle injury claims, including the classification of an injury, will be adjudicated by B.C.’s Civil Resolution Tribunal, an independent body that already adjudicates strata and small claims disputes in the province.
The Attorney General said that the changes will reduce the amount ICBC spends on legal fees and expenses, which have grown to consume 24 percent of ICBC’s budget.
“For too long, difficult decisions have been put off and growing financial problems at ICBC hidden from the public,” said Eby. “The changes we’re initiating today will reduce ICBC’s claims costs by more than $1 billion every year, helping make it sustainable for decades to come. ICBC was created to provide affordable insurance to all B.C. drivers, but years of reckless decisions by the previous government have thrown the corporation into financial chaos. Today we start making the tough decisions that will stem ICBC’s losses, keep insurance affordable and provide enhanced care for people injured in automobile accidents. We’re going to make ICBC work for people again.”
Though Eby announced a cap on smaller claims, he also announced the first major change in accident benefits in 25 years. The allowance for overall medical care and recovery costs will be doubled to $300,000, retroactive to January 1st of this year. The changes come after it was revealed last week that ICBC was projecting a net loss of $1.3 billion this fiscal year.
Eby also announced that ICBC will be consulting with customers on major revisions to the corporation’s rate structure with the goal of ensuring good drivers pay less, and bad drivers pay more.
Green Party leader Andrew Weaver released a statement supporting the changes announced by Eby today, saying he was pleased to see increased financial support for accident victims with more serious injuries.
“These changes mean that a larger share of our public insurance funds will go directly towards helping British Columbians who suffer accidents recover from their injuries,” said Weaver. “A successful, affordable public insurance system requires the government to act in the best interests of the people who participate in it. The B.C. Liberals betrayed the trust of British Columbians when they pillaged ICBC’s capital reserves, and ignored and concealed the evidence-based recommendations put forth by their own consultants. The mess left behind by the Liberals’ reckless fiscal mismanagement necessitates major changes, and I’m glad that the current government is taking this seriously. I look forward to seeing the proposed changes to the rate structures, but am encouraged that the Attorney General has signalled a move towards a fairer model that rewards good drivers while ensuring bad drivers pay their fair share based on risk.”